The AFL-CIO Housing Investment Trust recently announced that, after working closely with PNC Real Estate and Developers Mortgage Corporation, it has provided $32 million of pension capital funding toward the major rehabilitation of Chicago’s 2101 South Michigan Apartments.
The 26-story residential tower, located on Chicago’s Near South Side, was built in 1971 with financial help from the Federal Housing Administration’s grant program for affordable housing. Currently the property is in need of major upgrades that will ultimately help the 250-unit building become more energy efficient. The $42 million renovation project includes a new lobby, community room, on-site laundry facility and energy-efficient appliances, as well as new heating and cooling in the individual units. The rehabilitation work is expected to generate around 245 union construction jobs.
“As older downtown neighborhoods experience growth with the corresponding demand for housing, it’s very important to preserve and update existing units whenever possible,” said HIT Executive Vice President and Chief Investment Officer Stephanie H. Wiggins. “The HIT’s investment in 2101 South Michigan will help ensure that quality housing near Chicago’s downtown Loop, with its employment opportunities and other amenities, remains available to individuals and families at all income levels.”
Located in Chicago’s South Loop neighborhood, the 2101 South Michigan property is in an area that is experiencing a growing demand for residential units and neighborhood amenities. Of the building’s units, 90 are subsidized through a Housing Assistance Payment contract which is administered by the U.S. Department of Housing and Urban Development. Out of those units, 39 are restricted to residents age 62 and older. Those units will stay affordable through a long-term HAP contract which extends the affordability component of the property for another 20 years.
“HIT’s union pension investments have helped address the housing and economic development needs of working families in the Chicago area,” said Lesyllee White, HIT’s senior vice president and managing director of marketing. “The HIT has financed the production of housing for low- and moderate-income families, while also generating union construction jobs. This is having a significant impact on working families. HIT is actively targeting Chicago to fund more income- and job-generating investments in 2013.”
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